A guide for French SCPIs investing in Irish real estate

For French Société Civile de Placement Immobilier (SCPI) funds, the Irish real estate market offers attractive investment opportunities, but its distinct operating and tax environment requires careful consideration and guidance.

For French SCPIs, understanding the purchasing process and tax considerations from the outset is essential to managing risk and ensuring a seamless, successful transaction. 

Ogier’s Real Estate team includes legal and tax experts in Ireland with considerable experience assisting SCPIs through the early stages of acquisition, remaining trusted partners throughout the lifecycle of asset management. From time pressures through to execution priorities, transaction structuring and tax due diligence, we understand the key issues that matter to French SCPIs, ensuring a service tailored to fit a “papier de pierre” seeking to invest in Ireland.

Here is a step-by-step guide for SCPIs purchasing property in Ireland, including an overview of transaction structuring and tax considerations.

The purchasing process

Week one: sale agreed and initial steps

The Irish legal purchasing process, or “conveyancing”, begins at the “sale agreed” stage. At this point, the purchaser and vendor have reached agreement on the terms of the sale, and the purchaser pays a booking deposit to the selling agent. This deposit is fully refundable until the contracts have been executed. This element of the process is usually managed by the agents. This is the opening of the exclusivity period.

It is important to ask the agents to make sure that the selling solicitors have deeds and all relevant compliance paperwork ready to go during the negotiation period. We understand the time pressure our SCPI clients operate under, but many vendors do not.  If this is not clearly communicated, it will delay the start of the purchase timetable.

Week two: receipt of draft contracts and title documentation

Within 7-10 days after the sale is agreed and the heads of terms (HOTs) is finalised (booking deposit paid), the vendor’s solicitor will issue the draft contract for sale to the purchaser’s solicitor with copies of the title deeds and any relevant supporting documentation. This is the start of the legal due diligence process. In many cases this is managed through a virtual data room (VDR).

If a VDR is available, we recommend getting legal access arranged early to speed the process up.

Weeks two to eight: contract review and raising of legal queries

The purchaser’s solicitor undertakes a detailed review of the draft contract and all relevant title documents. Legal (and tax) queries are raised with the vendor’s solicitor. Common queries relate to mapping, planning permission and tenant matters.

Any red flags are raised directly to the purchaser to consider and assess the risk. A draft title report and tax report is prepared and discussed with the clients. This will be fine-tuned over the due diligence period.

This stage, including contract negotiation and full investigation of title, typically takes between three and six weeks, depending on the complexity of the property and title. Our clients usually complete their technical due diligence at the same time. Co-ordination of the due diligence streams is very important and we typically help our clients with this.

The final title report document sets out key points relating to ownership, planning matters, any existing charges or encumbrances, easements (rights of way) and tenancies affecting the property. This offers greater comfort to the purchaser prior to executing the contracts and can be a useful resource once ownership has been transferred. 

The resolution of queries and signing of contracts 

Once all queries have been addressed and the terms of the contract have been agreed, the purchaser will sign the contract for sale and transfer a non-refundable deposit of 10% of the purchase price, minus the amount of the booking deposit.

When signed contracts and the deposit funds have been received by the vendor’s solicitor, the vendor signs the contract. At this point, the contract becomes binding. 

Completion of sale

Following contract signing, completion of the sale generally occurs within two weeks, though this period may be shorter if agreed between the parties. There can be delays here if the vendor is a foreign resident as some tax issues can slow things down.

Post-completion: registration with Tailte Éireann

After the sale is completed, the purchaser’s solicitor arranges for registration of the purchaser’s ownership, plus any mortgage or charge, with Tailte Éireann, the national authority for land and property registration in Ireland. Registration is essential to legally confirm the purchaser’s ownership and ensure protection of title. 

Tax considerations for SCPI investments in Ireland

Tax is a critical element in the acquisition and ongoing management of Irish real estate assets by SCPI clients. Ogier’s dedicated Tax team works alongside our Real Estate team, ensuring that tax matters are understood and addressed from the outset of each transaction.

Transaction structuring and due diligence

When SCPIs invest in Irish property, transaction structuring is crucial to ensure efficiency and compliance. At the start of each transaction, we conduct comprehensive tax due diligence, examining matters such as:

• the withholding tax implications and structuring options for income and capital gains
• stamp duty exposure and reliefs
• VAT status of the property, including the implications for both residential and commercial investments
• potential exposure to anti-avoidance provisions

These points are flagged for clients during initial due diligence and incorporated into the advisory process throughout.

Ongoing tax compliance and reporting

We guide our SCPI clients in understanding their Irish tax registration and filing obligations, including corporation tax and local filing requirements for non-resident entities. We advise on the tax treatment of rental income and other ongoing tax queries that can arise during the life of the transaction.

With changes in Irish and European tax rules, regular review is essential. Our Tax team monitors legislative developments relevant to foreign investors, ensuring SCPI clients remain compliant and well-informed.

How Ogier in Ireland can help

French SCPIs benefit from integrated legal and tax advice tailored to the realities of the Irish real estate market. Our joined-up Real Estate and Tax teams support efficient acquisitions, clear structuring and effective asset management, helping identify and manage any issues from the outset. This ensures SCPIs benefit from smooth technical due diligence, integrated advice and practical problem solving.

With considerable local market insight and an international perspective, we understand the time pressures, reporting requirements and commercial priorities that matter to French investors, allowing transactions to progress smoothly and with confidence.

For more information, contact a member of our team via their contact details below. 

About Ogier

Ogier is a professional services firm with the knowledge and expertise to handle the most demanding and complex transactions and provide expert, efficient and cost-effective services to all our clients. We regularly win awards for the quality of our client service, our work and our people.

Disclaimer

This client briefing has been prepared for clients and professional associates of Ogier. The information and expressions of opinion which it contains are not intended to be a comprehensive study or to provide legal advice and should not be treated as a substitute for specific advice concerning individual situations.

Regulatory information can be found under Legal Notice